PSA looks to plug-in hybrids to meet emissions goals

SOCHAUX, France - PSA Group's plug-in hybrid push is about to begin, as the automaker gears up its factories to produce a range of low-emission vehicles that will help it meet increasingly tougher European pollution standards.

The DS 7 Crossback will be the first PSA vehicle sold with the company's new plug-in hybrid drivetrain, with sales starting by September 2019. It will be followed by the Peugeot 3008 and 508, the Opel Grandland X and the Citroen C5 Aircross. All the models are built on PSA's e-EMP2 architecture for compact and midsize vehicles.

Cars built on the smaller CMP platform, starting with the DS 3 Crossback, will have full-electric variants instead of plug-in hybrids for cost and complexity reasons.

The group's Push to Pass midterm strategy under CEO Carlos Tavares calls for 15 new electrified vehicles by 2021, including eight plug-in hybrids and seven battery-electric models. By 2025, all group models will have an "electrified" version.

While other automakers, including Renault, Volkswagen and Mercedes-Benz, are expanding their full-electric lineups to meet EU emissions standards — and avoid hundreds of millions of euros in potential fines — PSA executives are confident that plug-in hybrids will be an easier sell to consumers who worry about electric vehicles' range, charging time and availability of charging stations.

"A fundamental selling point of a plug-in hybrid is liberty," Olivier Salvat, PSA's PHEV program director, said this month on a presentation of the group's factory in Sochaux, eastern France.

PSA has taken pains to ensure that buyers notice no differences between models, for example preserving trunk space by offering run-flat tires on hybrids instead of a spare tire, Salvat said. The only visible difference is a charging port on the opposite side from the gas filler.

Where they will notice a difference is in the sticker price, but PSA officials say that over time the total cost of ownership of a plug-in hybrid should be roughly the same as a diesel, depending on driving style. PSA is also calling on the French government to reinstate incentives for hybrids. France offers up to 6,000 euros for electric cars, but a 1,000 euro prime for plug-in hybrids was discontinued in 2017.

The Peugeot 3008 and Opel Grandland X will be produced at Sochaux, which is the staging point for hybrid production techniques at all PSA plants. PSA's factory in nearby Mulhouse will make the DS 7 and Peugeot 508 hybrids; the Citroen C5 Crossback will be made in Rennes, France; and the Opel Grandland X will also be produced in Eisenach, Germany. Overall, PSA has invested 100 million euros to adapt plants to make plug-in hybrids.

'Same part, same process'

One of the concerns about plug-in hybrids is that their complexity (essentially two separate drivetrains) brings increased production costs, which are then passed along to consumers. PSA said it had taken steps to reduce manufacturing costs, using a strategy it calls "same part, same process."

"We won't launch a vehicle if it won't be profitable," Salvat said. "To do that we needed to create the most efficient manufacturing process."

That means as much as possible, common components and manufacturing processes — such are marrying the drivetrain to the body in white -- are used for both internal-combustion and hybrid variants. PSA says that just 7 to 8 percent of parts are specific to hybrids. Among them are reinforcements to provide more protection for the batteries, an electric motor mounted inline with the gearbox, brake components that recoup energy, and a reservoir to capture gasoline fumes when the car is in electric mode.

Plug-in hybrids make up a tiny but growing percentage of European sales, with about 0.8 percent of total sales in 2017. Sales rose by 34 percent to about 144,000 from 2016 to 2017 in the European Union plus the European Free Trade Association countries — which include Norway, the largest market by percentage for alternative fuel vehicles thanks to government incentives, according to industry group ACEA.

CO2 'super credits'

However, sales are expected to rise sharply as automakers seek ways to meet fleet carbon dioxide emissions standards of 95 g/km by 2021, a figure that could fall a further 30 percent by mid-decade. Plug-in hybrids will qualify for the EU’s emission "super credits"— meaning that any car emitting 49 g/km of CO2 or less will count as two vehicles in 2020, 1.67 in 2021, 1.33 in 2022 and one in 2023.

PSA says its hybrids meet that standard, even under the new WLTP testing regime, which has resulted in some plug-in hybrids testing above the 49 g/km level. The automaker says plug-in hybrid sales could reach 1.9 million vehicles by 2025.

PSA will produce plug-in hybrids in two versions: four-wheel-drive models will have a 200 hp 1.6 liter gasoline engine and two 80 kw (110 hp) electric motors, one mounted at the rear axle; two-wheel-drive models will have a 180 hp gasoline engine and a single electric motor. An energy recovery system can extend the range by about 10 percent.

The automaker declined to provide sales targets for plug-in hybrids, but DS officials said at the launch of the DS 7 Crossback that about 15 percent of buyers are expected to choose the four-wheel-drive plug-in version, called the e-Tense, which will cost about 65,000 euros in the highest trim level, more than twice as expensive as the lowest-price gasoline model.